Launching in the shadow of Blockbuster Kickstarters
Can you ride the blockbuster wave to crowdfunding success?
Do you get frustrated when big name creators come to Kickstarter? Are you finding it harder to get your books funded? Maybe there’s a way to use big names to your advantage!
In a previous post, I suggested Kickstarter isn’t a zero-sum game, and that big name creators on the platform can be beneficial for the entire ecosystem.
The feedback I received pointed out there was little evidence to support my statement. I don’t disagree with that, but my post wasn’t about the impact of big name creators, it was about the importance of trust. I felt this was a bigger problem for indie creators than campaigns run by bigger names.
So I scanned the literature to find something that could shed light on my initial statement. Do big name creators help or hinder indie creators?
Turns out some folks were interested in the exact same question and had published a paper in September 2023 called “Winner Takes All? The Blockbuster Effect on Crowdfunding Platforms,”1 which discussed the effects of hugely successful (Blockbuster) projects on other projects that are live around the same time.
The background
The authors noted two competing hypotheses in the crowdfunding literature. The first was that Blockbuster projects have a detrimental effect on small projects (i.e., the zero-sum hypothesis). The second was that Blockbuster projects may actually be beneficial to small projects.
Their study set out to explore which of these was correct.
The authors used Kickstarter data from all projects launched between 2009-2014 for their analysis (186,000 projects from 158,000 unique creators). They also compiled backer lists for every project in this dataset (over 18M activities from 7M backers) and also daily funding data for all projects between 2012-2014 (approximately 60% of all the projects in the first dataset).
Additionally, they collected Google Trends data for the term “Kickstarter,” all social media activity related to Kickstarter and projects on Twitter, and online news articles related to both Kickstarter and the projects.
Blockbusters are defined by the total amount pledged and the number of backers. Cluster analysis then identified 29 Blockbuster projects that raised at least $1.2M and had over 11.5K backers (most of which were new).
It’s important to note that these were the measures at the end of each individual campaign. It may not always be obvious when a Blockbuster campaign actually becomes a Blockbuster, which is why the daily data is important - as that allows the authors to estimate the campaign day when a project officially could be classified as a Blockbuster.
If that sounds like minutiae, I understand, but please bear with me as it will be important later.
The findings
The results showed that projects launched after a Blockbuster campaign emerged were positively impacted by the bigger campaign. Analysis showed pledges increased by 0.9% and backer numbers by 0.3% if there was also a Blockbuster campaign running.
But also…
If the project was related to the Blockbuster, it also received a boost with an average increase of 6.1% in terms of the amount pledged and 1.7% in terms of number of backers. If the project wasn’t related, then there was very little impact on it.
Finally, the authors asked if timing was important. Was it better to have a project live before a Blockbuster campaign launched? Or was it better to launch after a Blockbuster had been identified?
This actually turned out to be critical. If the Blockbuster was identified before project launch, then there was a significant positive effect (3.4% increase in amount pledged and 1.4% increase in backers). However, if the Blockbuster appeared after launch, then there was a significant negative effect (1.1% decrease in amount pledged and 0.6% decrease in number of backers).
The Google Trends and Twitter data further supported the hypothesis that Kickstarter became more popular when there were Blockbuster projects. Analysis of the backer data also revealed that Blockbusters attracted both existing and new backers, who went on to back other projects on the platform (over 9000 for each Blockbuster), especially similar ones (15.5 on average compared to 0.82 dissimilar projects), and backed more when a given campaign launched after the emergence of a Blockbuster.
What does it mean?
For creators, it’s important to be aware of the emergence of Blockbuster campaigns, and try to piggyback on their success by launching while the Blockbuster is still live. This is particularly important if your project is similar, as you will accrue all the benefits of the other campaign.
Of course, if a campaign launches after you and goes on to become a Blockbuster - there’s not much you can do about it. All you can do is keep promoting and marketing yourself as best you can.
For Kickstarter as a platform, it’s helpful for them to amplify the Blockbuster campaign while it’s live in order to bring more backers to the platform. This is particularly true if they highlight the specifics of the campaign and thus make it easier for this influx of backers to find other, related projects.
In conclusion, big name creators are more likely to have Blockbuster campaigns, but there is a net benefit for indie creators in terms of the measures identified above. This is particularly true if you launch in the shadow of a Blockbuster, and can piggy-back on it to make your campaign more successful.
Of course, it’s not obvious or easy to spot Blockbuster campaigns if you’re not actively looking at what’s happening on Kickstarter, and what other campaigns are doing. I think this is perhaps another lesson that emerged from my read of this paper - that it’s not just about you as a solo creator trying to promote your project. It’s about you as a creator operating in a network of other creators. Use that network to your advantage and that will ultimately be the thing that helps you succeed.
What do you think? Does this resonate with you? Do you disagree? Let me know in the comments.
Zhiyi Wang, Lusi Yang, Jungpil Hahn (2023) Winner Takes All? The Blockbuster Effect on Crowdfunding Platforms. Information Systems Research 34(3):935-960. https://doi.org/10.1287/isre.2022.1154